In every maze there’s always a beginning. It’s been more than twenty years since the Immigration Reform and Control Act of 1986 (IRCA)[1] was passed. In that time, the U.S. immigration laws were, for the most part, neither uniformly nor consistently enforced. Agents typically did not even search for noncompliance beyond the border states. Although IRCA provides for the imposition of civil fines and criminal penalties for breaking the law, in reality the low level of enforcement has not achieved any deterrent effect.

That has changed because in 2006 the government began enforcing IRCA. The Department of Homeland Security (DHS) and the Bureau of Immigration and Customs Enforcement (ICE), formerly known as the Immigration and Naturalization Service (INS), substantially stepped up their enforcement efforts and broadened their searches into the interior United States, arresting more than 700 company officials on charges of violating immigration laws, compared with 25 in 2002. With numerous highly publicized raids,[2] the new twists and turns in these workplace enforcement actions have enlarged the maze and heightened the confusion.

The new enforcement strategy focuses on extensive investigations and sanctions, using the harboring, smuggling, concealing and transportation criminal code provisions to pursue organizations and employers who deliberately, intentionally, and knowingly hire and employ illegal aliens and otherwise ignore the requirements of the IRCA. The construction, hospitality, textiles, agriculture, and food processing industries are especially in the spotlight, as these industries historically employ larger percentages of unauthorized alien workers.

IRCA Provisions and Requirements

IRCA makes it unlawful for any employer to employ, or continue to employ, an alien whom it knows is not authorized to work in the United States. The law applies no matter how many or few employees work for an employer.[3] Under the regulations implementing IRCA,[4] the employer has three basic obligations:

See that the new hire completes Section 1 of the Form I-9;

Complete the employer’s section of the I-9 (Section 2);

"Physically examine the documentation presented by the individual” that establishes his/her identity and employment eligibility.[5]

IRCA does not prohibit an employer from offering a potential hire a job prior to checking documents. However, within three business days of the hire, the employer is required by IRCA to physically examine the documentation presented and ensure that the documents appear to be legitimate and to relate to the individual.[6] The regulations do not require the employer to verify or authenticate the authenticity of the documents—only to examine them to see that they reasonably appear to be genuine on their faces. The IRCA regulations provide that an employer who makes good faith efforts to comply with the employment verification requirements has a good faith defense that he/she has not violated the law.[7] It should not be surprising to learn that there has been huge growth in the false document industry that furnishes the documents necessary to obtain jobs to undocumented workers who can pay for them.

Civil and Criminal Penalties for Violating IRCA

The statutory consequences of violating the IRCA include both civil and criminal penalties. A person who engages in a “pattern or practice of violations” (meaning regular, repeated and intentional activities) may be fined up to $3,000 for each unauthorized alien, imprisoned for up to six months, or both.[8] However, before fines can be imposed, there must be a finding that the employer knowingly hired the illegal alien. A fine of $275 to $2,200 will be levied for a first-time offender. For a second offense, the penalties range from $2,200 to $5,500 for each illegal worker. And for a third-time offender, the fines range from $3,300 to $11,000. The employer may also be subject to a cease and desist order to stop hiring unauthorized aliens, and order to comply with the law, and other appropriate remedial action as is deemed appropriate.

In pattern or practice violations, the attorney general can sue employers in federal court, using the criminal code’s harboring, smuggling, concealing, and transporting illegal aliens for financial gain to crackdown on those who repeatedly disregard the requirements of IRCA and knowingly hire and employ illegal workers. Criminal conviction can result in individual liability with a sentence of up to ten years in prison and/or $250,000 in fines per alien, or both.

Failure to properly complete the I-9 Form can result in a fine of $110 to $1,100 per form. Additionally, ICE fines for late completion range from $300 to $400 per form. A first violation of the knowing employment prohibition can result in a penalty of $275 to $2,200. The second violation penalties can be from $2,200 to $5,500. Third violation penalties range from $3,300 to $11,000, and the employer is also at risk for criminal pattern or practice liability. The criteria considered in determining the size of the fine include: the size of the business, the good faith of the employer, the seriousness of the violation, whether the individual was an unauthorized alien, and the employer’s history of previous violations.[9]

When names and social security numbers of employees do not match, the Social Security Administration (SSA) sends a letter to an employer—this is called a “mismatch letter.” In past years, it was the unwritten policy of the INS to allow employers to disregard such mismatch letters because it was not the responsibility of an employer to question the employment authorization of a worker who appeared on the mismatch list. As with everything else, that, too, has changed—more confusion. DHS has now made it clear that it will take action against employers who ignore the SSA mismatch letter because workers who show up on the SSA mismatch letter over and over again are presumed to be illegal workers.[10]

Current Government Strategy

The recent developments of 2006 illustrate the government’s renewed commitment to enforcing the U.S. immigration laws. Turning a blind eye will no longer shield the employer from liability when the employer knowingly allows illegal aliens to remain on the worksite and continue working—even if the falsely documented workers are actually employed by some other entity such a subcontractor.[11] Such conduct can be viewed as harboring, smuggling, or transporting illegal aliens. DHS is now asking the courts to impose the most severe penalties and criminal sanctions to bring an end to such “systemic violations” of the immigration laws.

Failure of civil fines and heightened emphasis on “homeland security” has prompted government agencies charged with enforcing U.S. immigration laws, and IRCA in particular, to shift tactics and focus on extensive investigations and the bringing of harsh criminal charges. When all factors are considered, however, honest employers who make good faith efforts to comply with the law are not likely to be fined if an employee’s documents prove to be false. So long as the I-9 Form is properly completed and the documentation presented by the employee is physically examined in good faith, the organization and employer should not face liability.

The employer’s obligations to prevent the hiring and continued employment of illegal aliens are pretty clear cut. The commitment to compliance should be displayed in every office where applicants apply for positions. Further, the employer should require all consultants, independent contractors, vendors, and suppliers to certify their compliance with immigration laws. The following practices should be incorporated into an employer’s compliance policy:

Confirm that staff performing verification is properly trained. Original (not photocopies) documents, except for a certified birth certificate, should be examined. If you can’t see the originals, use an agent or notary public.

Do not allow employees to begin working until the I-9 Form is complete.

Make photocopies of documents. Keep I-9 Forms in a separate file, not in personnel folders.

Consider using the free SSA online verification system to reduce the number of people on the SSA mismatch letter in the future.

Give employees whose names show up on the mismatch letter written notice that they need to try to resolve their problem at the local SSA office. Let them know that you don’t know what action you might have to take if they appear on the mismatch list again.

Create and communicate a policy regarding visitors to your offices. Require all visitors check in. Government visitors should be referred to management before being allowed access to property or employees.

Conduct periodic self-audits to confirm that the association has I-9 Forms for all current employees. If you are missing forms, obtain them as soon as possible. If you are missing forms for terminated employees, consider contacting them to obtain a form. Review the I-9 Form during an exit interview or before an employee is terminated, as this may be your last opportunity to get a signature or other necessary information.

During self-audits, examine I-9 Forms to ensure they are properly completed. Check that there is an actual street address, not a P.O. Box number. If you have photocopies of documents employees presented, you can use them to obtain the missing information. If necessary, contact the employee to obtain missing information. If the employee neglected to sign or date Section 1, ask the employee to do so. Use correct dates to the extent possible. If you add or revise information in Section 1 of the form, complete the Preparer/Translator certification. Consider adding “self-audit” next to any form corrections.

Purge I-9 Forms during self-audits. Follow the retention rule: three years from date of hire and one year from date of termination. When you meet both tests, throw out the form.

More than ever before, associations, like all other employers, must stay on top of changing business environments and government policy. Given thepublic nature of many associations, they are well advised to implement or reissue policies that demonstrate their commitment to compliance with U.S. immigration laws. Further, associations can provide important “value-added” information by sharing their compliance guidelines and procedures with their members. With knowledge and training, association employers should be able to navigate the maze and come out on the side of legally documented employees.

Naomi R. Angel is a partner with the law firm of Howe & Hutton, Ltd., Chicago, Illinois.

Thanks to Gerald P. Panaro, also of Howe & Hutton, Ltd., and David C. Whitlock, Fisher & Phillips LLP, who helped with this article.

[2] IFCO Systems (pallets manufacturer) raids on 4/16/06: ICE arrested 7 current and former managers and picked up more than 1,100 employees at over 40 U.S. locations, managers and supervisors charged with harboring and concealing illegal workers for commercial advantage or private financial gain; Fischer Homes (builder of homes) raid on 5/9/06: ICE arrested 4 construction supervisors and 76 workers at 3 separate job sites, employees worked for contractors and subcontractors, supervisors charged with harboring and concealing illegal aliens; Swift & Co. (meatpacking plant) raids on 12/12/06: ICE arrested nearly 1,300 suspected undocumented workers at 6 facilities nationwide on administrative immigration violations and some existing criminal arrest warrants; Michael Bianco (leather goods factory) raid on 3/6/07: ICE arrested the owner and 3 managers and rounded up more than 350 workers, top officials charged with conspiring to hire illegal immigrants and to encourage or induce illegal immigrants to live in the U.S.; Golden State Fence Company (fence-building company) and 2 executives pled guilty to felony charges on 12/14/06 of knowingly hiring more than 10 undocumented workers in 2 offices over period of 7 years, sentenced on 3/28/07 to $4.7 million company forfeiture, $200,000 and $100,000 individual fines, 1,040 hours of community service, 6 months home confinement, and 3 years probation.

[3] There is a separate provision in IRCA prohibiting discrimination based on national origin or citizenship status, but it only applies to employers with four or more employees.

[10] Employer has 14 days to review and correct its records. Employee must correct any problem within 60 days or employer’s receipt of mismatch letter. If employer ignores this process, DHS will conclude that employer know of illegal employment.

[11] Fischer Homes (builder of homes) raid on 5/9/06: Employers can now be held criminally liable for their contractor’s compliance, or lack thereof. Contracts should require contractors to comply and certify compliance. Employers should take immediate action to remove workers suspected or known to be illegal workers.